lokesh machines ltd. · started his career with hmt limited in 1966 and soon after he has...
TRANSCRIPT
ACROSS THE SLIDES
LOKESH MACHINES LTD - AT A GLANCE
LEADER IN MACHINE TOOLS AND AUTO COMPONENT MANUFACTURING
RESTRUCTURING ITS WAY TO SUCCESS…
…WITH A CLEAR VISION AND MISSION
MILESTONES
BUSINESS DIVISIONS
…SUPPORTED BY STATE-OF-THE ART FACILITIES
MACHINES DIVISION – CNC MACHINES
MACHINES DIVISION – SPECIAL PURPOSE MACHINES (SPM)
AUTO COMPONENTS DIVISION
CATERING TO THE MARQUE CLIENTELE
DRIVEN BY VISIONARY PROMOTERS…
...SUPPORTED BY COMPETITIVE STRENGTHS
...SUPPORTED BY COMPETITIVE STRENGTHS
FINANCIALS AT A GLANCE
STRATEGIC PRIORITIES
GUIDANCE
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LOKESH MACHINES LTD - AT A GLANCE
Year of inception
1985Promoter’s experience in the Machine Tooling
Industry
35Years +
Manufacturing facilities across Hyderabad and
Pune
5Machines
annual capacity
900
Market Capitalisation as on March 31, 2018
Rs.98.43Crores
BSE Ticker
532740NSE Symbol
LOKESHMACH
Revenues in 2017-18
Rs.175.78Crores
EBIDTA in 2017-18
Rs.29.42Crores
PAT in 2017-18
Rs.4.70Crores
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Manufactures:
CNC machines(GPM)
Special purpose machines (SPM)
Automobile components
Precision engineering components
LEADER IN MACHINE TOOLS AND AUTO COMPONENT MANUFACTURING
Remarkable achievements:
Only Indian Company to have successfully executed Volvo Eicher's Euro 6 Engine Project
India’s and Asia’s first Company to successfully execute and supply complete cylinder block and cylinder head
manufacturing SPMs for an EURO 6 Engine
Pioneered in integrating gantry loaders for cylinder blocks and crank shafts in a TIER I industry
Pioneered to develop work changers in SPMs
India’s first Company to manufacture 5- Axis horizontal borers and export to Italy
India’s first company to manufacture and export high speed vertical machining centers to Japan
Longer life of machines performanceMachines developed in 2003 have the same accuracy levels till date
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RESTRUCTURING ITS WAY TO SUCCESS…
Tough Times 2010 - 2013Anticipating a demand boom in the auto industry, the Company formulated aggressive growth plans and executed projects involving capex of over Rs. 80 croresThe automobile industry, on the flipside, went into prolonged lean phase leading to loss of business and sharp erosion in marginThe Company was saddled with an overall debt of over Rs. 125 crores, leading to stressed financialsWorking capital constraints further led to curtailed productionWith drastic fall in production levels, the Company was saddled with excess inventory
Recovery Phase 2015 - 2018Raised equity capital to the tune of around Rs. 36.71 crores between 2015-2018Disposed-off the non-core assets of the subsidiary to cut on the losses and reduce debts; reduced its total debt from Rs. 125 crores to Rs. 83.94 crores as on March 31, 2018; post repayments, the term loans have reduced significantly from Rs 57.66 Cr to Rs. 23.00 crores as on March 31, 2018 Reduced inventory and receivable levels (days), specially in 2018, to bring much needed liquidityIn order to achieve quick turnaround, the management decided to put greater focus on CNC machines(GPMs) which had relatively shorter execution and working capital cycle; consequently sale of CNC machines increased from Rs. 58.81 Crores in 2015 to Rs. 106.50 Crores in 2018
Growth Phase With expected debt-equity and interest cover of 0.42 and 3.50 respectively, there is marked improvement in the financial position of the CompanySignificant ramp up in marketing efforts has led to deeper penetration leading to 32% growth in turnover during 2018; The Company expects turnover to grow at CAGR of 30% during next three years to reach Rs370 crores mark by 2021The Company expects to incur capex of Rs. 15 crores over next 24 months which would be largely met from internal accruals and suppliers’ credit.
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…WITH A CLEAR VISION AND MISSION
Doubling the Annual Revenues by2021 through the introduction of newproducts and solutions for auto &non-auto sectors, improving point ofpresence, continuously upgradingtechnologically, building requiredcompetencies and thereby reachingdominant presence, satisfying allstakeholders consistently.
To champion high quality parts eco-system through manufacturing servicesand machining services and providinginnovative and cost-effective solutions,satisfying all stakeholders in a uniquemanner.
MissionVision 2021
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MILESTONES
1984Lokesh Machines
Limited Incorporated
1986Commenced commercial
production of SPMs
1993Provided turnkey SPMs for cylinder blocks & cylinder heads to Ashok
Leyland Hino Engines
1996Developed first
component manufacturing line
for supply of machined cylinder
blocks to M&M
1997Introduced CNC
machines
1999Developed second
component manufacturing line for supply of machined
cylinder blocks to M&M tractor division
2000Supplied complete turnkey SPMs to M/s
John Deere for their cylinder block manufacturing plant.
Supplied third line of machined cylinder blocks to M&M for Scorpio & Arjun
Tractors
Recognised as India’s first Company to manufacture 5- Axis horizontal borers
and export to M/s FPT of Italy
2003Component
division certifiedQS 9000
2004Recognised as India’s first
company to manufacture and export high speed vertical
machining centers to Japan for M/S HOWA Machinery
Corporation
2005Component division certified TS 16946
2006IPO & Listing on BSE/ NSE (May)
2016Tie up with Taiwan-based Tongtai to manufacture hi-
speed vertical machining centre model EZ5
Entered into an agreement with Austria-based EMCO GmbH for
selling hi-end technology machines
Connecting Rod Line2 - state-of-the-art facility to machine fracture connecting
rods at Ranjangaon Pune2009
Developed fourth line for supply of mustang model cylinder blocks to M&M
2010Developed fifth
line for supply of machined cylinder heads to Mahindra
Heavy trucks
2011Started new plant at
Ranjangaon Pune
Developed sixth line for supply of 2-cylinder Blocks
to M&M Chakan from Ranjangaon Pune
2012Formally inaugurated
Ranjangaon plant
2013Recognised as India’s and
Asia’s first Company to supply complete Cylinder Block and Cylinder Head manufacturing SPMs for
EURO 6 Engine: Customer-M/s VOLVO EICHER
2014Connected Rod Line 1 - state-of-the-art facility to machine
fracture connecting rods at Ranjangaon
Pune
2015Developed 7th Line for machining of 3 cylinder blocks for
M&M
2017Became the first Company
in Hyderabad to be IATF certified
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BUSINESS DIVISIONS…
Machines Division Components Division
CNC Machines(Location: Balanagar,
HyderabadProduct: CNC Lathes)
Special Purpose Machines
(Location: Bonthapally, Medak
Product: SPMs)
Cylinder Blocks Machining
(Location: HyderabadMedchal
Product: Cylinder Blocks)
Pune
Cylinder Blocks Machining
Connecting Rod
CNC Machines(Location: Toopran,
HyderabadProduct: VMC
Machines)
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…SUPPORTED BY STATE-OF-THE ART FACILITIES
Balanagar & Toopran Hyderabad
Products Manufactured:1) CNC Lathes2) Vertical Machining Centers3) Drill Tap Centers4) Horizontal Machining Centers
Capacities: 900 m/cs per annum
Land Area (sqmtr): 2,16,871
Captured Area (sqmtr): 1,15,000
Bonthapally, Hyderabad
Products Manufactured:1) Special Purpose Machines2) Jigs & Fixtures
Capacities: Vary Due to machinery sizes and value
Land Area (sqmtr): 22,795
Captured Area (sqmtr): 18,795
Medchal, Hyderabad
Products Manufactured: 1) Machining of Cylinder Blocks
Capacities: 2,00,000 nos. per annum
Land Area (sqmtr): 40,400
Captured Area (sqmtr): 36,000
Pune, Maharashtra
Products Manufactured:1) Machining of Cylinder Blocks2) Machining of Cylinder Heads3) Manufacturing Fracture
Connecting Rods
Capacities: Cylinder Blocks: 1,00,000/ annumCylinder Heads: 60,000/ annumCon Rods: 2 Million/ annum
Land Area (sqmtr): 19,000
Captured Area (sqmtr):11,400
We have sufficient space in all above units for future expansion if required.
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MACHINES DIVISION – CNC MACHINES
Ranks amongst leading machine tool manufacturers in the country
Range of CNCs include Vertical machining centres, Horizontal machining centres and CNC Lathes
Manufactured around 600 CNC machines in 2017-18; target 900 machines for 2018-19
Capacities being further augmented to 1,250 machines in 2018-19 and 1,500 machines in 2019-20 with a
capex of Rs.10 crore. Major investments are already in place, only capacity balancing will be done.
Delivered over 4,000 CNC Machines till date
Technical Collaboration with M/s TongTai of Taiwan and M/s EMCO of Austria
20%Auto OEMs
60%Auto ancillaries
20%General industries and exports
Application Industries
61%Contribution to total revenues in 2017-18
HORIZONTAL MACHINING CENTRE
VERTICAL MACHINING CNETRE
CNC LATHE
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MACHINES DIVISION – SPECIAL PURPOSE MACHINES (SPM)
Range of SPMs include:
o Rotary Indexing Machineso Simplex and duplex milling machineso Multi drilling machineso Gun drilling machineso Fine boring machineso Mini transfer lineso Semi-automated equipmentPreferred source for cam & crank borers and piston cylinder boring machinesOnly Indian company and amongst few globally to have manufactured machines for a euro 6 engine platform ISO 9001 : 2008 certified BY M/s TUVThe Company has confirmed orders of around Rs. 12 crores to supply SPMs to reputed OEMs; additional orders of around Rs. 10 crores are under final discussion with OEMs and shall be finalised during the course of the year
Application Industries5%Contribution to total revenues in 2017-18
ISO/ TS 16949ISO 9001
90%Automobile Industry
10%General industries and exports
SPMs SUPPLIED TO M/S VOLVO EICHER
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AUTO COMPONENTS DIVISION
India’s leading supplier of machined engine blocks & heads
Equipped with one-of-its kind and totally automated, flexible FRACTURE connecting rod line at Pune with an annual
capacity of 1.5 million units
The connecting rod plant at Pune is operating at around 40% capacity; the Company is in discussion with the current
customers for increasing their offtakes as well as for supply of new models.
ISO / TS 16949 : 2009 certified BY M/s TUV
3,00,000Annual installed capacities of
cylinder blocks
60,000Annual installed capacities
of cylinder head
2 millionAnnual installed capacities
of connecting rods
20%Passenger Vehicles
60%Commercial Vehicles
20%Off-road vehicles
Application Industries34%Contribution to total revenues in 2017-18
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DRIVEN BY VISIONARY PROMOTERS…
Mr. M. Lokeswara RaoChief Promoter and a first-generation technocrat with 35 years of vast experience in the machine tool industryStarted his career with HMT Limited in 1966 and soon after he has established Lokesh Machines as a small engineering company manufacturing special purpose machinesHis visionary leadership transformed the Company into a mutli-product company with product offerings expanded to general purpose machines, auto components apart from special purpose machines
Mr. B. Kishore BabuPossesses over 31 years experience in the field of machine tool industryStarted his carrier in HMT as Trainee Engineer and presently is the Executive Director of Lokesh Machines LimitedHe has worked in various departments right from shop floor, designs, planning, production, assembly, purchase and application engineering for the past 23 yearsHas received training across various countries
Mr. M. SrinivasElder son of Lokeswara RaoPossesses over 20 years of experience in manufacturing and mechanical engineeringJoined Lokesh Machines post completion of M S in Industrial Engineering (Manufacturing) at New Jersey Institute of Technology, New Jersey, USAUnderwent training initially in the designs and manufacture of Special Purpose Machines
Mr. M. SrikrishnaYounger son of Mr. M. Lokeswara RaoPossesses over 17 years of experience in the field of mechanical engineering Joined Lokesh Machines Limited since last 9 years post completion of Bachelor of Engineering at Osmania UniversityUndergone initial training in the designs and manufacture of CNC Machines
Mr. K .Krishna SwamyPossesses over 46 years of experience in designing
Started his career with HMT during 1964 and after a long stint in all its divisions, became the Chief Engineer in-charge of its design department during 1978 to 1983
During his tenure at HMT, he had received training under experts in the design field including Cross Company Inc., USA, and the then collaborator of HMT
He has designed a number of machines notable among them being Rotary Indexing Machines, Linear Transfer Machines, Line Boring Machines etc. based on deep
knowledge in designing machines that suit the requirements of customers
Associated with Lokesh Machine since last 25 years and is presently the Technical Director, contributing significantly
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...SUPPORTED BY COMPETITIVE STRENGTHS
Design and Development
Comprises well-trained and highly skilled executives (around 30) having exposures to international standard of machine tool technology
Equipped with latest designing software like Catia, Pro-E and AutoCAD
Provides total solution to customers with specialisation in:
o Machine designso Fixture designso Tool designso Hydraulic and pneumatic designso Electrical and electronic designso Systems and applications
In the past, the Company was associated with the following Multi National Machine Tool Builders:
HELLERGermanyGermanyJapanItaly
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...SUPPORTED BY COMPETITIVE STRENGTHS
Quality labs equipped with the following major facilities:
LK 3: Co-ordinate measuring machines
Hewlett Packard: Laser interferometer
Renishaw: Ball bar system
Renishaw: Laser interferometer
Tesa/Trimos/Mitutoyo: Digital height masters
Taylor Hobson: Surface finish tester
Quality
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FINANCIALS AT A GLANCE
120.73 121.98 132.13
175.78
2014-15 2015-16 2016-17 2017-18
Total Revenue
29.39
26.29
28.26
29.41
2014-15 2015-16 2016-17 2017-18
EBITDA
0.74
2.14 2.20
4.70
2014-15 2015-16 2016-17 2017-18
PAT
85.8598.77
113.67 119.75
2014-15 2015-16 2016-17 2017-18
Reserves & Surplus
102.88114.94
133.46 137.65
2014-15 2015-16 2016-17 2017-18
Net Worth
201.42
214.49221.05
227.92
2014-15 2015-16 2016-17 2017-18
Gross Block
In Rs.crores17
Particulars 2015-16 2016-17 2017-18Total Revenue 121.98 132.13 174.78EBITDA 26.29 28.26 29.41EBIDTA Margins (%) 19.16 19.19 16.82PAT 2.14 2.20 4.70Share Capital 14.71 17.03 17.90Share Application Money 1.46 2.76 0.00Reserves & Surplus 98.77 113.67 119.75Net Worth 114.94 133.46 137.65Gross Block 214.48 221.04 227.892Term Loans 42.26 31.43 23.01
FINANCIALS AT A GLANCE
In Rs.crores
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STRATEGIC PRIORITIES
1. Accelerate sales growthPenetrate further into the untapped markets of Western Regions and certain portions in SouthDrive additional growth form the non-automotive sectors like power, aerospace, defence, pumps and agri-based industriesThe Company’s new plant at Toopran, Hyderabad is now operational .❖ The new plant has major mother machines like Plano Miller, Horizontal Borer and Big Vertical Milling
machine used for manufacturing of VMCs and HMCs and other bigger machines.❖ More than 25000 square feet of assembly space is available with Overhead Crane and other facilities.❖ This would comfortably cater to around 600 machines assembly per year.
Drive overall sales at a CAGR of 30% over the next three yearsIncreasing contribution from high margin business (SPM) and automation solutions will lead to growth in sales and better profitability
2. Increase product offeringsCollaborate with leading players for the multi-tasking machinesDevelop Industry 4.0 and IOT ready machines with advance technology and next generation features
4. Revamp HR PracticesAdapt contemporary HR practicesRetrain people on latest machine tool and manufacturing techniquesCreate a better environment to perform and excel
5. Total productivity managementExtend life of the machinery and assetsContinuous technology upgradations and automations, leveraging the technology tie ups with Tongtai and EMCO
2017-18 2018-19 (P) 2019-20 (P)
15% 20% 25%
Revenues from the non-automotive sectors
3. Leverage economies of scale & sweating of assetsValue addition and value engineering (VA/VE) of the existing product line for better efficiencies and premiumisationIdentifying commonality of machine content (sharing of parts) for better leverageTalking with the OEMs for newer requirementsUtilise spare capacities of the component division
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GUIDANCE
Rs. CroresParticulars 2017-18 2018-19 (P)Total Revenues 174.78 235.00-GPM 106.50 152.00-SPM 9.00 18.00-Auto Components 59.28 65.00
EBIDTA 29.41 40.00EBIDTA% 16.82 17.00PAT 4.70 15.00Equity Capital 17.90 17.90Total Debts(Including Working capital)
85.98 64.43
-Secured 80.98 59.43-Unsecured 5.00 5.00
Rs.CroresParticulars 2017-18 2018-19 (P)Debt equity 0.62 0.42EPS (Rs.) 2.73 8.38
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THANKYOU
Investor ContactName: V. Sudhakar Reddy
CFOPhone no: 9866647845
Matru Prasad MishraCompany Secretary
Phone No: [email protected]
Corporate OfficeB-29, EEIE Stage II, Balanagar
Hyderabad-500037Telangana, India
Websitewww.lokeshmachines.com
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